government procurement - a supplier's perspective

Copyright © 2015 Equinox Limited |

Government procurement:A supplier’s perspective

New Zealand Procurement AcademyBreakfast SessionPaul Ramsay – 28 May 2015


Equinox IT is New Zealand’s leading

independent IT consultancy, delivering

software development, consulting and

training services.

Established in 1995, we inject fresh

thinking to solve tough business

problems.

Equinox IT has over 70 staff based in

Wellington and Auckland.

About Equinox IT

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• Demand

• Consumer

• Agency

• Taxpayer interests

• Supply

• Enabler

• Sector

• Economic development

What you do is important

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• Inclusive

• Open

• Flexible

• Tailored

• ‘Bite-sized’

• Fit for purpose

• Exclusive

• Closed

• Fixed

• One size fits all

• ‘Big-bang’

• Perfect

How you do it is even more important

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Balancing conflicting demands

• Wants vs. needs

• Risk vs. reward

• Rigidity vs. agility

• Status quo vs. innovation

• Complexity vs. simplicity

• Unknown vs. certainty

• International commitments vs. local obligations

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‘Pick any two’ – you can’t have everything

Time

Cost Quality

Scope

Risk

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Questionable procurement practices

• Endeavouring to outsource every risk and all accountability

• Dubious interpretation and selective application of the rules

• The myth of the ‘level playing field’

• Predetermined outcomes

• Lowest cost at all costs

• Honest estimation (‘true cost’) is often penalised

• Exercises in self-justification – ‘win / lose’

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• The delivery of business value (‘results’) is ultimately the only outcome that really matters

• What is the ‘outcome’ you need?

• What does ‘value’ look like?

Delivering outcomes

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Concrete Lifejackets


• Procurement occurs ina context:• Before (strategy)

• After (operation)

• Must consider:• Whole of life

• Total cost of ownership

• There is always a price to be paid – it is just a question of who and when

Procurement is a process not an outcome

Acknowledgement: Office of the Auditor-General, ‘Central Government: Cost Effectiveness and Improving Annual Reports’

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• Capability:

• Knowledge

• Skills

• Experience

• Maturity:

• Markets

• Organisations

• Individuals

Building on both sides

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• ‘Size and scale’

• Tender documents:

• Reader-centric

• Respondable

• Contracts:

• Intellectual property

• Liquidated damages

• Payment terms

• Are they clear, concise and complete?

Keeping it in perspective

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• Only ask for what you really need

• Don’t put in place any unnecessary barriers

• Allow the supplier to demonstrate excellence

• Make it simple and easy to respond

• Be mindful of the time and cost involved in responding

• Be open and transparent

Making it easy

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• What did we do well?

• What could we have done better?

• What should we do differently next time?

Learning from experience

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Some final observations

• What you do makes a difference

• Government use and referenceability is important

• Understand the wider implications of your actions

• Don’t hide behind process – look to engage with suppliers before, during and after procurement

• If you want innovation then you need to be innovative in how you procure it

• Don’t mitigate the opportunity when mitigating risks

• ‘The cost of quality is the expense of doing things wrong’

• Promote and acknowledge examples of ‘good practice’

• A strong, diverse and vibrant local market is in everyone’s best interests

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Injecting fresh thinking to solve tough business problems

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government procurement - a supplier's perspective

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